One thing retailers do is to keep busy – too busy! Of the thousands of retailers I have spoken with over the years, their biggest problem is that they are so busy putting out fires and keeping up that they don’t have the time to deal with something that will solve their problems.
Once a retailer is underway, things should not be overwhelming unless they are allowed to become so. There are always employee problems, but should there be? When employees are hired, they should have convinced you that they want and need the job and will do everything necessary to help improve the store. But that’s not always the case as we do most of the talking in the interview and convince ourselves that they will do the right thing. That creates problems and more fires to put out, so your hiring policy and employee development programs should be in place and positive.
There are going to be problems with merchandise shipments coming at the wrong time, figuring out what to do with the merchandise and how to pay the invoice. There will be problems with displays, advertising, banking, the weather, the utilities and every imaginable thing. And yes, as a retailer you will be required to deal with all of it. But early planning will go a long way to eliminating many of these situations before they become problems.
The biggest problem retailers face is merchandise. Having enough and not having too much are critical problems. Having too little merchandise will mean missed sales and having too much will mean markdowns. Neither is good for your financial health and both create more work and “fires” to put out. But since retailers are so busy, they rarely take the time to develop a buying plan tied to anticipated sales and desired turn rates.
For every retailer, developing a buying plan is time well spent. Consider how smoothly your store would run if you always had the right amount of merchandise in the right area at the right time. Seasons would change and styles would change and you would always be right there with just the right amount of the newest and best merchandise available. Markdowns (better known as profit killers, not traffic builders) would diminish noticeably and sales and profits would increase (also noticeably).
So, retailers must develop, maintain, and revise an open to buy plan so that they are always ordering to meet sales, not to fill space or satisfy a supplier. Your store is YOUR store and your opportunity to extract the maximum return from each dollar invested in inventory. This will happen if you are ordering with an eye on improving turnover and the only way to do that is with open to buy planning. Because OTB is based on what you expect to sell and the rate you want to turn your dollars, your buying plan will be solid and meet the needs of your store.
And as soon as that happens, you will be able to make other plans to continue reducing the possible fires that you will have to put out and you’ll find you have more time on your hands to work on improving your store.